Amazon (AMZN) is set to release Q2 earnings on Tuesday July 26th after the market closes on the heel's of eBay's (EBAY) announcement last week which was solid (we cover it here at sister-site eBay Strategies).
Wall Street is looking for:
- 33% y/y growth (slowing from 36%)
- Domestic growth is expected to be 45%
- International growth should be 24%
- $9.29B in revenue for Q2
- $375m in pro-forma operating income
William Blair Report Summary
Mark Miller, internet analyst at William Blair, issued a report recently (you can download the full report here) called "More Retailers Struggling to Navigate Amazon's Surging Current". In the report, Miller looks at some of the top brick-and-mortar (B+M) retailers and compares their selection and pricing to Amazon's.
- B+M retailer's websites are not price competitive with their own stores
- Companies that face the largest threat from Amazon: HHGregg (HGG), Bed Bath and Beyond (BBBY), Best Buy (BBY), Target (TGT), Dicks and Kohls. (KSS)
- Of 2400 items half are available on Amazon and at 11% cheaper than competitors
- Amazon's price advantage would persist even if it faced taxes
- Amazon's 3P marketplace is a strategic foundation for this strength
Here are three really interesting tables from the report that show the depth of research and some pretty amazing findings.
Table 1 - Selection comparison (click to enlarge images):
The table above compares the selection of 100 items from competitive stores to Amazon's 1P selection, 3P, etc.
Table 2 - This table compares prices of 100 items to Amazon's 1P and 3P prices:
While Amazon has come a long way, with 50% SKU coverage they still have a lot of work to do, and room to grow, in the dimension of selection. We'll provide detailed analysis of their Q2 results later this week.
Disclosure: I am long Google and Amazon. eBay is an investor in ChannelAdvisor where I am CEO.